Cessna trims workforce, maintains production

April 4, 2013

ByJim Moore

Aerial view of the Cessna factory in Wichita, Kan.

Seeking to cut costs, Cessna Aircraft Co. is offering “voluntary separation” to an unspecified number of workers who are not directly involved with aircraft production. The company stated in an email April 3 that the action is being taken to “streamline our business to continue to improve our cost competitiveness.”

There was no mention of an incentive for employees who opt for “voluntary separation” as of May 3; hourly direct employees are not eligible, or “impacted,” as a spokesman said in an email to AOPA.

The Wichita Eagle reported the offer is being made to workers 55 and older who are not directly involved in aircraft production. Employees who choose to depart must respond by April 12.

Cessna public relations staff said the company is declining requests for interviews about the program, and aircraft production rates will remain unchanged.

Cessna has yet to comment about an apparently abundant inventory of Cessna 162 Skycatchers which AOPA reported March 14 based on FAA documents that indicate new registrations of the two-seat aircraft have all but stopped. The Cessna 162 is being manufactured in China for final assembly in Kansas.

Cessna’s parent company, Textron, is scheduled to issue its next earnings report April 17. Analysts are more or less evenly divided on the stock, which posted earnings of $0.56 per share in January, $0.02 short of the consensus estimate by analysts. Revenue also fell short of analyst estimates. Textron stock reached a one-year high in mid-March, closing above $31 per share, but closed April 3 at $28.52, still above the one-year low of $22.22 set in March 2012. Textron is also the parent of Bell Helicopter and Lycoming Engines, among other subsidiaries.

There are sound financial reasons for aircraft ownership. Beyond the money saved on overnight trips, delays caused by airlines, and other miscellaneous expenses, owning an airplane has definite tax advantages.